North American companies focused on exploration and production can expect the market to deteriorate further as low oil price pressures endure, Moody's said.

"Even under a scenario with a modest recovery from current prices, producing companies and the drillers and service companies that support them will experience rising financial stress with much lower cash flows," Moody's Investors Service said in a research note.

Crude oil prices entered 2016 on a severe downturn. Though moving up in recent days, the price for Brent, the global benchmark, is down 14 percent since the start of the year. Oil prices are down more than 70 percent from peak levels in 2014, leaving energy companies with little spare cash to invest in exploration and production.

Moody's said there are few signs of any major recovery in crude oil prices. Iran is expected to add 500,000 barrels of oil per day to the global market as sanctions pressures ease and few other players are willing to rein in production as they defend their market shares.

"Increased production vastly exceeds growth in oil consumption, lower oil prices will further weaken cash flows for exploration and production companies and the upstream portion of integrated oil and gas companies," Moody's said. "This will cause further deterioration in financial ratios, including deeper negative free cash flow."

Schlumberger, one of the world's largest field services companies, said it was trimming 10,000 from its payrolls because of the sector downturn.

Last week, energy consultant group Wood Mackenzie estimated about $170 billion in spending through 2020 has been delayed because of sector weakness.